Abstract

Economic growth matters not just because it leads to rising prosperity. People living in countries with growing economies tend to be happier and more optimistic. Material improvement leads to general satisfaction; stagnation or decline leads to misery and pessimism. Economic growth matters because its absence causes long-term unemployment and falling living standards for many. Growth is also the only realistic way to generate the tax revenues needed to service the outsized sovereign debts that so many countries have accumulated today, and to fund the obligations of ageing societies.